In June 1996 the ruling National Liberation Party maintained its pact with the opposition Social Christian Unity Party to approve the Economic Guarantees bill. Among other measures, the bill restricted the government deficit to 1% of gross domestic product unless two-thirds of the congressional deputies agreed to a higher limit. The legislation would not be implemented until after the 1997 elections.

In late July Hurricane Cesar struck Costa Rica, causing widespread damage, especially in the south. More than 30 people died, many communities were isolated, and parts of the Pan-American Highway were destroyed. Pres. José María Figueres Olsen estimated the cost of repairs at $100 million.

The tourist industry, the country’s main foreign exchange earner, was badly affected by the kidnapping of a German and a Swiss visitor in the first 2 1/2 months of 1996. Although both were released unharmed, many overseas operators canceled tours.

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